The Interoperability of Financial Data
(Job Market Paper, R&R Management Science)
Elif Cansu Akoguz, Tarik Roukny, Tamas Vadasz
Interoperability of payment data — live third-party access to customers' transaction records — improves competition in credit. But it also reprices the market where the data is produced: payment services. We study this spillover in a model in which lenders must observe a firm's live payment flows to monitor it, and sharing infrastructure is costly to operate. Welfare depends on both markets: wide sharing is optimal when costs are low, no sharing when they are high. Sharing, however, never emerges voluntarily. A targeted (narrow) mandate lets the bank convert its credit-market rent into a payment-market premium, so the bank gains while firms can be net losers as payment prices rise. A wide mandate competes the premium away, yet it is never strictly necessary: under a narrow mandate, the rival provider widens the regime on its own wherever widening pays. Data-sharing mandates should therefore be scoped in light of their infrastructure costs and evaluated across the markets they connect.
Data collection and cyber-security in platforms: Enforcement or self-regulation?
(Working paper on request)
Elif Cansu Akoguz, Tarik Roukny
We study how policy can discipline a platform’s data collection and protection. Data lets the platform tailor prices, but it also exposes users to risk. Because users cannot observe the platform’s cybersecurity practices, the platform faces moral hazard and under-protects. Certification makes these practices verifiable, letting the platform self-regulate and partially correcting under-protection. It is, however, a double-edged sword: users’ lack of sophistication can sometimes shield them from over-collection and over-protection, and certification removes that shield. Enforced standards reduce under-protection further when fixed security costs are high, but they carry a different risk: to avoid the cost of meeting the standard, the platform may stop collecting data altogether. This hurts users when network effects are strong, since tailored prices bring more users onto the platform. The best policy approach depends critically on how much of the data risk and cybersecurity cost is fixed and how much scales with the platform’s activity. Fixed security costs drive under-protection, while fixed data risk, together with the activity-scaled security cost, drives over-protection.
A new indirect tax tool for EUROMOD
This project developed a new Indirect Tax Tool (ITTv3) for EUROMOD, the EU’s microsimulation model for tax-benefit analysis. The new tool allows researchers and policymakers to simulate indirect tax reforms with much greater precision across 18 EU countries —capturing effects at highly disaggregated levels of goods and services, and under different behavioral assumptions. The key challenge we overcame was that existing EU-SILC datasets contain detailed income information but lack expenditure data, which are essential for simulating indirect taxes like VAT and excises. To solve this, we designed and implemented a novel imputation method that transfers detailed expenditure patterns from Household Budget Surveys (HBS) into EU-SILC, while preserving realistic relationships between household characteristics and spending behavior. Our approach combines regression-based predictions with hot-deck matching, ensuring consistency across ~200 expenditure categories while addressing structural issues inherent to expenditure data.